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Here's Where You Can (and Can't) Buy a Home On Your Salary

Alamo Square in San Francisco.

If you’re dreaming of buying a home in a major U.S. city this year, you might be surprised at how much (or how little) you’ll need to earn first.

Combining third-quarter median home prices from the National Association of Realtors with its own mortgage rate data, mortgage comparison site HSH.com found how much a home buyer would need to earn to buy a pad in 25 major U.S. metros.

You’d need to bring in at least $125,000 a year to purchase a home in notoriously expensive San Francisco, where houses sell for an average $705,000 in the Bay Area.  

Out of your price range? You might want to try your fortunes down South or, better yet, the Midwest.

San Francisco’s market is a far cry from Atlanta, where buyers only need to bring in about $27,000 to afford a house today. And even though property values have increased by 6% year over year in Cleveland, Ohio, you still only need $22,000 to snap up a home. The median home price there is under $128,000.

But it’s worth noting that this study only calculated how much you’d need to earn to cover the mortgage principal and interest payments on the average home in each city. Once you move in and add on property taxes, insurance and other living expenses, you could easily need two or (in the case of San Franciscans) three times as much to live comfortably.

All in all, you should expect to shell out more for a house this year in most major cities. Buoyed by a steadily improving housing market, property values increased 15% across the nation, according to HSH. That’s enough to price many prospective buyers out of the market, given the fact that the average income for U.S. households has actually fallen 6.1% since the onset of the recession in 2007.

Presenting another challenge are rising mortgage rates which, though still low compared to the years leading up to the housing crisis, jumped from 3.34% at the beginning of 2013 to a peak of 4.58% for a 30-year fixed rate mortgage in August.

“There’s definitely affordability challenges in some markets,” says Keith Gumbinger, vice president at HSH. “In markets like San Francisco, not only are home prices higher than virtually everywhere else … but when you subtract the 20% down payment, that still leaves you with a jumbo mortgage. It’s a double whammy of higher prices and higher financing costs.”

Despite higher housing costs, however, the average U.S. family could still afford a home in about 18 of the 25 cities HSH studied, including Houston, Cincinnati, and Miami. Plus, the farther outside these major hubs you go, the more home prices will fall.

Here’s the full list of cities from most to least expensive. For details on home values, mortgage payments, etc. check out the study here.

25. San Francisco: $125,071.78
24. San Diego: $85,842.74
23. Los Angeles: $79,176.55
22. New York City: $71,254.65
21. Boston: $68,956.41
20. Washington, D.C.: $68,345.39
19. Seattle: $63,145.41
18. Denver: $50,662.05
17. Portland, Ore.: $49,170.46
16. Baltimore: $46,622.88
15. Sacramento: $45,345.74
14. Miami: $44,534.57
13. Philadelphia: $40,517.29
12. Minneapolis: $37,114.99
11. Chicago: $37,078.02
10. Phoenix: $33,497.81
9. Houston: $32,682.92
8. Dallas: $32,051.99
7. San Antonio: $31,154.35
6. Orlando: $29,630.85
5. Tampa: $26,930.35
4. Atlanta: $26,862.53
3. St. Louis: $25,227.82
2. Cincinnati: $25,151.04
1. Cleveland: $22,348.03